By Sarah Turner
LONDON (Dow Jones)--Shares of pub operators Enterprise Inns and
Punch Taverns soared in London Thursday on a favourable regulatory
ruling, but the broader markets ended lower on the day.
The Office of Fair Trading said that it is ending its
investigation of a complaint from the Campaign for Real Ale about
how requirements forcing pub franchisees to purchase beer through
their landlord.
"The OFT has found that there is generally effective competition
between pubs and does not consider that supply ties contribute to
higher prices or prevent pubs offering a wide choice to consumers,"
the regulatory body said.
Analysts welcomed the decision.
Altium Securities analysts said: "This removes a concern that
could have had a significant impact on [tenanted pub operator]
business models. The news will come as a significant relief to
Punch and Enterprise who have the largest tenanted estates in the
U.K., followed by Marston's and Greene King."
Tenanted pubs are owned by pub companies which charge managing
landlords rent and supply beer.
Shares of Enterprise Inns rose 23.7%, Punch Taverns shares
climbed 14.9%, Marston's shares rose 3.3% and Greene King shares
climbed 1.9%.
All of these companies trade outside the U.K.'s top FTSE 100
index , which fell 0.97% to 5,207.36. Other European shares were
also weak.
Asian shares fell after data pointed to an acceleration of
Chinese growth in the third-quarter, raising the prospect that
Beijing may begin to unwind its crisis-driven expansionary policies
by year's end.
"A material change in policy at the People's Bank of China is
likely to be associated with a loss of economic momentum and this
could in turn induce a strong reaction in global equity markets,"
said Mike Lenhoff, chief strategist at brokerage Brewin
Dolphin.
Miners were weak in line with lower metal futures, with silver
miner Fresnillo down 1.2%, copper miner Antofagasta down 2.3% and
Xstrata down 1.6%.
Xstrata's former bid target, Anglo American , performed better
than the sector, ending the day up 0.7%.
It said it will reorganize its business into seven units and
will sell non-core assets. It will also cut around 2,700
white-collar jobs to achieve cost savings anticipated at $120
million per year.
Separately, the firm reported its third-quarter copper
production rose 13.4% to 168,500 metric tonnes, while iron-ore
production increased 15.7% to 11.9 million tonnes. In total,
third-quarter production rose 43% compared to the second
quarter.
Platinum producer Lonmin fell 0.6%.
It mined 2.6 million tonnes in its fiscal fourth quarter, down
20% from the same point a year ago, as planned closures hit
production. Lonmin expects to achieve 2010 sales of around 700,000
platinum ounces, slightly ahead of 2009.
"South African platinum group metal producers are likely to face
continued industry-related challenges in 2010 and the decision
announced today to move the operational headquarters from London to
Johannesburg reflects our determination to drive operational
performance more effectively," the firm said.
Oil futures also weakened and oil producers declined, with Royal
Dutch Shell shares down 1.3%.
Away from commodities and shares of insurer Aviva lost 2.7%. It
will integrate its operations in 12 businesses across Europe,
creating a single European holding company and simplifying its
structure.
Services Desk; Dow Jones Newswires; +44-20-7842-9319/9274